Cash registers are ringing in response to unprecedented demand for the much-anticipated Xbox(TM) video game system from Microsoft Corp. (Nasdaq: MSFT - news). Thousands of gamers lined up at stores across the country beginning Thursday, Nov. 15, to be among the first to purchase Xbox, resulting in a near sellout in its first day at retail. Early reports also show a huge demand for games and accessories, with most customers leaving stores not only with an Xbox, but with more than three games and accessories. Top-selling games include ``Halo(TM),'' ``Project Gotham Racing(TM),'' ``NFL(TM) Fever 2002'' and ``Oddworld: Munch's Oddysee(TM)'' from Microsoft® Game Studios; ``Madden(TM) NFL 2002'' from Electronic Arts; and Tecmo's ``Dead or Alive 3(TM),'' an Xbox exclusive.

``The Xbox launch was the best launch I have ever been a part of, and that goes all the way back to launches like that of Nintendo Entertainment System, Super NES, 3DO and Atari,'' said Dan DeMatteo, president of Gamestop Inc. ``It was the first time in recent memory we didn't have to air-ship product to meet the launch date. The momentum continues even after launch. We continue to sell everything we can get.''

The launch smashed many retailers' single-day sales records. According to Peter Roithmayr, vice president of merchandising at Electronics Boutique, ``It (the Xbox launch) was incredible. We had the single largest sales day in Electronics Boutique history Nov. 15. This was a record we thought would take forever to be broken. We have seen a very strong software and accessory attach beyond the first day of sales. Product continues to ship from Microsoft on a very timely basis, and consumers are obviously pleased.'' Microsoft's replenishment strategy is ensuring that more than 100,000 consoles are shipped to stores every week through the holidays. Microsoft is on track to greatly exceed this number in advance of the Thanksgiving weekend, the busiest shopping time of the year. By the end of the holiday season, Microsoft will have shipped between 1 million and 1.5 million Xbox units to North America.

``I'm excited to finally see Xbox in the hands of gamers,'' said John O'Rourke, director of sales and marketing for Xbox at Microsoft. ``I've always known that Xbox is the best game console ever, but after playing games with people at launch, I see that gamers also recognize the amazing power and intense fun that only Xbox can offer.''

Toys R Us Inc. Vice President World Manager Wayne Yodzio echoed the enthusiasm of many retailers. ``Launch has been excellent. We are still selling software and accessories, even after we continue to sell every console unit we get. Consumers are coming back and buying significant quantities of 'Dead or Alive 3,' 'NFL Fever 2002' and 'Halo.'''

Word-of-mouth recommendations and stellar reviews are driving gamers to the great games available on Xbox, including ``Halo,'' which earned the highest accolades from Electronic Gaming Monthly, securing a rating of 10 from all reviewers.

Nineteen Xbox titles are currently available for sale, with more than 30 titles expected to be on sale by the end of the holidays, including ``Amped: Freestyle Snowboarding(TM),'' ``Azurik: Rise of Perathia(TM)'' and ``Nightcaster(TM)'' from Microsoft Game Studios; ``WWF® Raw'' from THQ Inc.; and ``Star Wars® Starfighter(TM) Special Edition'' and ``Star Wars® Obi-Wan(TM)'' from LucasArts Entertainment Company.